Published , by TJ Denzer
Published , by TJ Denzer
China’s government has become one of the biggest threats to its own gaming giants by far. The continued effort to restrict playtime, game availability, and more have done financial harm to numerous companies in the video game and tech industries in China. However, the latest regulations from China’s government may be the hardest hitting yet to video game companies like Tencent and NetEase, and these restrictions appear to have caused stocks in both companies to take quite a tumble.
The Chinese government passed its newest regulations on gaming over the weekend, as reported early on August 30, 2021, by sources like video game analyst Daniel "ZhugeEX" Ahmad. According to the new regulations, minors in China are now restricted to one hour of playtime on Friday, Saturday, and Sunday, the strictest measures yet introduced in the country. Meant to curb gaming addiction, the new restrictions have had quite an effect on gaming publishers and developers like Tencent and NetEase, which make up two of the biggest forces in gaming in the country. Both also saw a significant dip in stock value on Monday, August 30, immediately following the news.
At first, NetEase saw the bigger dip in value, but it has climbed back a bit on news that it has recently reached “final negotiations” to poach Yakuza creator Toshihiro Nagoshi from a 32-year-long career at Sega.
Indeed, NetEase and Tencent may continue to turn their efforts beyond the borders of China and grow their influence in other nations, given the arguably ridiculous amount of regulation both companies are facing on their home turf. It's a matter that Tencent felt necessary to address directly in its recent quarterly reporting. Further measures are likely in the future for both companies as they seek to continue to grow despite government restrictions. Stay tuned as we continue to follow this story for further updates and information.